WestLB pair 'cut corners'

AN investigation into WestLB will conclude that the bank's former boss and another director cut corners to finance the controversial Box Clever rental deal that caused heavy losses last year.

German financial regulator BaFin's report into the bank's lending activities is likely to level 'heavy criticism' at former chief executive Jurgen Sengera and ex-board member Andreas Siebert, it was reported in Germany today.

The investigation has led to the bank halting new investment by its London-based principal finance unit headed by City high-flier Robin Saunders, and saw Sengera and Siebert leave the bank. Saunders is not thought to have been singled out for criticism.

Sengera and Siebert are said to have wrongly informed the credit committee 'in substantial parts' about the deal that the London unit helped to structure.

The Rhein Post newspaper, which claims to have seen extracts of the report, said today that BaFin will conclude that an 'unusually short planning phase' for the credit took place due to 'substantial time pressures' surrounding the deal.

The report quotes supervisory board chief Bernd Luththje as saying that the deal raised 'doubts about the technical suitability and reliability of the responsible persons of members of the board'.

The deal on the former Radio Rentals business cost the bank more than e400m (£277m) in write-downs. A probe by the public prosecutor in Dusseldorf is continuing.